Wisdom of WTO Doha reforms questioned

The director-general of the World Trade Organization Pascal Lamy said he was more optimistic as the latest installment of the Doha Development Round negotiations began in Davros, Switzerland, Jan. 27.

But that doesn't mean ministers from the 30 countries expected to be represented at the talks will be any closer to an agreement when they leave Davros than when they left Hong Kong last month. Some observers are beginning to question whether they should be.

In an indication of how formidable a task they face, the agriculture minister of Japan said he would resist pressure from the United States and other major exporting nations to reduce protection for his farmers.

Shoichi Nakagawa, who had just met with U.S. Trade Representative Rob Portman, said Portman made it clear the United States will focus on the reduction of import tariffs on agricultural products. He indicated he did not plan to comply with Portman's demands in the negotiations, which are slated to continue off and on until April 30.

European Union officials flatly refused last fall to agree to any further tariff reductions. EU efforts to divert attention from the market access issue led to a draft text in Hong Kong that singled out the U.S. cotton program for “special treatment” in the Doha Round, some observers say.

U.S. farm organizations and farm-state congressmen have been saying the United States should not follow through on its proposal for a 60 percent reduction in farm subsidies unless the EU, Japan and others agree to increased market access.

But the Europeans seem determined to stick with their offer of a 46 percent reduction in EU tariffs (the United States proposes a 75 percent reduction) and the Japanese appear to be dead set against lowering their 700 percent tariff on rice, which they say is an integral part of their culture.

The French government remains the major obstacle to tariff reform in the EU. Faced with problems with rising unemployment, President Jacques Chirac has drawn a line that he says the EU will not cross when it comes to agriculture.

Some are also questioning how much trade reform will help farmers in developing countries. A report, “The Tyranny of Free Trade,” released by the Netherlands-based Friends of the Earth in December, claims small farmers would be forced off their land as larger farmers expand to meet increased export demand.

Those claims seem to mirror concerns expressed by the National Farmers Union and the National Cotton Council, whose members would bear the brunt of the Doha reforms.

While some WTO members argued in Hong Kong that U.S. proposals did not go far enough toward reducing subsidies, NFU President Dave Frederickson said the WTO does not have the best interests of farmers in mind.

“We continue to argue that agricultural trade agreements must start with the goal of improving the incomes of farmers and ranchers,” he said. “What's being debated in the Doha Round would do the opposite.”